Look Around

September 30, 2014

One thing that CI DIYers have to learn (and so do some CI professionals) is to look around, to use your peripheral CI vision.

If you were considering buying a home, you would, of course, check out the house, maybe even hire an expert to do it in more detail than you can. The same is true in CI.

But, in the case of the home, you would go further. You would look at the neighbors on every side – how are their homes kept up? Then you would check out the rest of the neighborhood, looking at schools, parks, stores, the fire station, traffic flow, etc. Unfortunately, in CI, that is not always the case.

To use your peripheral CI vision, think more broadly. Yes, you have the competitor – which we often call the Target. The very term reflects the narrowing of the focus. But there is more to the Target than the enterprise. There is also its location, its own competitors, suppliers, unions, local economy, supply chain, etc.

Why don’t we do this in CI? One reason may be that getting the data on a CI target can be very easy. That, in turn, can make us lazy. Why not just take the low-hanging fruit? Getting the rest is a lot more work. Does it become too much?

Let me give you an example. We worked with a CI manager on a case involving a large company that had purchased a small competitor (Local Firm). The client was properly concerned that the new owner could make changes at the Local Firm, potentially disruptive ones. We established the competitor’s plans, in part by reviewing the (very) local newspaper’s want ads by the Local Firm.

But that paper contained much more. Later issues contained the ads by other, even smaller, local competitors, purchased following a hiring blitz by the competitor. They showed these local firms were now hurting for skilled labor, as the Local Firm had been aggressively hiring – evidently from them. That forced up wages at the other local competitors as the base rates advertised increased over time. That in turn means that the Local Firm was now paying more than the old local scale. These ads, for firms other than the Local Firm, provided some additional CI on the Local Firm, enabling a bit of deconstruction of its labor costs.

“In order to better understand the world, you will have to turn away from it….” Deodatta V. Shenai-Khatkhate.


Data from the Internet is NEVER the same as Competitive Intelligence

September 23, 2014

By now, it should be clear that having access to the Internet is not the answer to anything. It is akin to saying that having access to the Pennsylvania Turnpike means you can drive safely anywhere. The issue is where are you trying to get and how? Or, for the Internet, what data are you seeking to locate to then analyze?

A recent article on the current state of information overload in Time rightly observed “[F]or the most part, answers are good to know. You just have to ask the right questions.[1]

Now, I am not saying that doing some basic Internet research at the beginning of your own competitive intelligence project is not a good idea. Actually, it is a very good place to start. But it is only that, a starting point, not a destination. Use it to gain a general idea of your target(s), the competitive environment, and what people/organizations/resources with access/experience/knowledge could provide further data. But always apply your analysis and analytical tools to what you find, including a determination of how reliable the source for data is, as well as deciding how likely it is that the data you found there is correct (caution: these are 2 different issues).

But, in spite of all of our experience in CI, we still hear “Why do we need someone doing CI? Just have him/her look it up on the Internet!” Of, course, that is based on the erroneous inference that the Internet is a vast, indexed, and juried reference work, easy to use and highly reliable, rather than a vast trackless wilderness filled with information, misinformation, dated information, disinformation, and outright nonsense.

As this same article rightly put it, “[I]nformation is not knowledge or wisdom, and data can mislead.” Be careful out there.

[1] Michael Grunwald, “The Second Age of Reason”, Time, September 8-15, 2014, pp. 36-39. Emphasis added.


Competitive intelligence without calling it CI

September 16, 2014

The current (Sept. 22, 2014) issue of Fortune includes a profile of Howard Ruby, the founder of Oakwood Worldwide, which generates $600 million per year in revenues[1].

Ruby started this business in 1960, and age 79, is still CEO. He actually started in business at age 5 with a lemonade stand (no joke). His career in real estate involved reinvention over the decades, starting with building furnished apartments for singles and eventually morphing into corporate housing, a lodging category which the article credits him with inventing.

The first piece of advice he offers to other entrepreneurs and business persons is

Have four eyes that go around your head. Look out for the competition at every turn and observe what’s happening around you. You have to be mindful of changes and where the markets are heading.”

Straight, direct and correct. And what makes this even more powerful is that Ruby is still working, which means he is maintain his business vision, including a focus on competitors, while gradually losing his own vision to retinitis pigmentosa.

[1] Dinah Eng (interviewer), “The Father of Corporate Housing”, Fortune, September 22, 2014, pp. 29-32.

Chess and competitive intelligence (part 2)

September 12, 2014

As I noted in the first post on this topic[1], the late Arthur C. Clarke, scientist and science fiction author, came up with a fictional device that basically eliminated privacy:

“Before [that], business was a closed game. Nobody knew my cards….And that gave me a lot of leverage for bluff, counterbluff…I could minimize my weaknesses, advertise my strengths, surprise the competition with a new strategy, whatever. But now the rules have changed. Now the game is more like chess….Now – for a price – any shareholder or competitor, or regulator come to that, can check up on any aspect of my operation….”[2]

What does it mean that business, with CI, is now a lot more like chess? Let’s look at more comments of great chess players for guidance. Hint: just insert the work “business” for “chess” and “competition” for “game” in the following. [3]


Analysis is the heart of competitive intelligence (CI). As a matter fact, if you have to divide your time between data collection and analysis, research and experience both show that you are better off putting more time into the analysis that into the data collection. As we noted in the past[4],

“CI professionals spend excessive effort, in terms of both time and money, on data collection. Over a decade of experience clearly indicates that the optimal distribution of effort (whether measured in terms of time, dollars, or some combination) among the four stages of the CI cycle is approximately as follows:

  • needs, 20%

  • collection, 30%

  • analysis, 40%

  • dissemination, 10%”[5]

“It is a well-known fact that almost all the outstanding chess-players have been first-class analysts.” (Mikhail Moiseyevich Botvinnik, Grand Master and World Chess Champion)

And your analysis must be accurate and honest. By that, I mean that you cannot be impacted by preconceptions, also known as blind spots, also known as blinders. These preconceptions may be yours, or they may be a part of your business’culture. In every case, you have to first analyze your own position accurately in order to be able to analyze your competitors’ positions accurately.

“Drawing general conclusions about your main weaknesses can provide a great stimulus to further growth.” (Alexander Alexandrovich Kotov, Grandmaster)

Making sure your CI is actionable


One of the key precepts underlying CI is that all CI must be actionable. That is, you, or whomever you give CI to, is able to take an action which could not be taken before or make a decision which could not be made before. Providing CI which does not support some action is a waste of time, money, and effort. That is the difference between “good to know” and “need to know”.

“It is not a move, even the best move, that you must seek, but a realizable plan.” (Eugene Alexandrovich Znosko-Borovsky, Chess Master)

[1] https://diy-ci.com/2014/07/30/chess-and-competitive-intelligence-part-1/

[2] Arthur C. Clarke and Stephen Baxter, The Light of Other Days. Thor Books. New York: 2000. p. 144.

[3] My thanks to http://www.chessquotes.com/ for this resource.

[4] John J. McGonagle and Carolyn M. Vella, The Manager’s Guide to Competitive Intelligence, Praeger, Westport, CT, 2003, p. 10.

[5] See John J. McGonagle and Carolyn M. Vella, The Internet Age of Competitive Intelligence, Praeger, Westport, CT. 1999, pp. 26-31 for more detail on the sources for these estimates.

Big Oil

This is a book review of Mark L. Robinson, Marketing Big Oil: Brand Lessons from the World’s Largest Companies, 2014. Palgrave Pilot, 153 pages.

Book review? Yes. Actually, I have done quite a few, mostly dealing with competitive intelligence and related subjects. And this one does deal with CI, among many other topics.

Some background: I have known Mark for many years, dating back to when he worked for (shudder) Big Oil, and then Deloitte. His knowledge of this industry is almost encyclopedic, and this book demonstrates that very well.

He focuses on marketing successes and failures (mostly failures) by Big Oil, and puts that in focus with a very readable and interesting history of Big Oil. Throughout the book, he notes where Big Oil has used both CI and industrial espionage to advance its operations. Interestingly, Mark observes that John D. Rockefeller, Sr. instituted the first business use of CI at Standard Oil by using the telegraph to send “actionable intelligence” to Standard Oil’s headquarters in NYC. (p. 23)

As far as I know, that makes the Standard Oil operations the earliest documented “CI” operation. Please post any earlier examples you know of.

More currently, he also briefly describes Mobil’s anticipation, before the energy shocks of the 1970s, of national and global energy shortages, as well as rising oil and gasoline price. How? Through its intelligence operations. (p. 91)

The book is very well researched, but also a great read, and a valuable tool not only for those in marketing, but also for those in crisis management, CI, and strategy. Get it.